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Recruitment activity falls sharply due to COVID-19 but Technology still predicting growth

28/04/20 Peter Livingstone Director

The latest REC report unsurprisingly highlights that COVID-19 had already started to impact the overall UK jobs market as uncertainty gripped the global economy.

The findings from the REC’s March Report on Jobs indicated some businesses cancelling or postponing hiring decisions as they adapted to the pandemic.

This highlighted the differences in market sectors as a recent poll by Imperial College Business School showed that companies intend to recruit new staff despite the uncertainty caused by the Coronavirus.

According to the poll of the Business School’s annual conference, 90% of attendees stated their firms would be seeking to hire new talent. Almost half of those surveyed (48%) said that technology was the most important skill amongst new recruits.

Also, the number of jobs advertised in the IT sector soared during March, according to figures from Totaljobs and the British Chamber of Commerce.

The key finding from March’s REC report indicated:

  • Permanent placements and Contract/Temporary appointments falling at quickest rates since the global financial crisis.
  • Candidate availability is still very low.

Neil Carberry, Chief Executive of the REC said, “The coronavirus pandemic has put the labour market on pause. It does mean massive disruption in the short term, but we need to remember that this has to be done to protect business and save lives.”

James Stewart Vice Chair at KPMG adds, “UK business needs to do what it can to adapt and survive the pandemic - and be able to emerge in the best position to ramp up once the crisis comes to an end”.

Quickest drop-in recruitment activity since 2009
After rising in the prior three months, permanent staff placements declined in March, with the rate of the reduction the sharpest since February 2009. Panels members cited COVID-19 pandemic had led many clients to postpone hiring decisions. Contracts and temporary billing were also affected, with a combination of the virus and pending IR35 policy changes leading to a reduction in billings.

Candidate supply contracts only modestly
Only a mild drop in candidate availability at the end of the first quarter, as there were some reports of redundancies due to COVID-19. Notably, permanent staff supply fell at the slowest pace since June 2013, whilst contract/temporary candidates numbers expanded at the quickest pace since July 2012.

Engineering & high technology jobs sector record higher vacancies
Permanent staff declined across eight of the ten monitored categories at the end of the first quarter. Medical care and Engineering were the only sectors to identify seasonal growth.

Though the availability of staff dipped again at the end of the first quarter the rate of decline weakened for the fourth consecutive month and was the slowest recorded since June 2013. Recruiters signalled only a mild reduction in permanent labour supply, the availability of contract and temporary workers rose for the first time since mid-2013.

Skill Shortages still Common
Regardless of COVID-19 the Report highlighted skill shortages in key engineering and high technology disciplines including Senior Electronics Engineers, Mechanical Design Engineers, Technicians, Software Engineering and Developers together with a broad variety of IT professionals including Data Scientist and Analysts.

Commenting on the report Peter Livingstone, Contracts Director at Redline Group said:

“COVID-19 has brought havoc across the global economy but with the UK government taking measures to protect workers and help businesses survive the shutdown, it’s vital for employers to adapt quickly to the new circumstances, avoid making an instant decisions. The REC data highlights that high tech and engineering professionals are still at short supply in the UK and globally meaning companies need to keep investing in research and development and ensure that recruitment plans are reviewed constantly as the world shifts increasingly digitally. 

“As companies radically rethink how they will operate in light of restrictions, the need for software skills is also likely to extend well beyond the tech sector. With businesses previously struggling to identify the volume of high tech candidates prior to COVID-19 and whilst anxiety does exist, 2020 will bring increased opportunities with technology developing on all fronts, employers are likely to see very little respite with many more technical solutions on the horizon such as:

  • Self-driving shuttles and driverless transport
  • Cell phones tracking future cases of COVID-19
  • Accelerated virus diagnostics via artificial intelligence
  • 3D printing to make ventilator parts and face shields
  • Smart city tools and IOT to assist first responders
  • Robots assisting factory workers
  • Infrared AI camera to detect potential coronavirus carriers

These and many other solutions mean that the engineering and high technology community will continue to dominate the new vacancy market for the foreseeable future.”

For more information regarding how we can help your business, please contact Redline Group on 01582 450054 or email